Despite a growing interest in digital technologies between organizations and consumers, in real world, the latter is finding it difficult to trust companies offering digital technologies or services, owing to the rapidly growing threat environment. This loss of digital trust is having a negative impact on business RoI, according to a newly conducted study by the analyst firm Frost & Sullivan. This perception gap can lead to complacency amongst businesses and undermine organizations’ efforts to understand the importance of consumer trust, improve their security infrastructure and enforce data protection policies, said the study.
The study commissioned by CA Technologies titled “Global State of Digital Trust Survey and Index 2018,” further reveals that 86 per cent of consumers have moderate to high digital trust towards the organizations they interact and transact with. This translates to 67-points on the Digital Trust Index, the highest, along with China, in Asia Pacific & Japan (APJ).
Losing Digital Trust: A Tangible Business Impact
The report emphasizes how consumers perceive and trust organisations to protect their digital data. 98 per cent of consumers responded that it is very important or crucial that their personally identifiable information (PII) is protected online. Furthermore, 99 per cent indicate that a high level of data protection is a priority when choosing online services. In India, 47% of consumers believe that services they have used in the past have experienced a breach, and of these 52% stopped using the service.
The report also comprises significant data about how business leaders and cybersecurity professionals within organisations view their responsibilities of data stewardship, the licensing of consumer data to third parties and the technologies they are implementing to protect data and customer privacy. In India, one-third of business executives admit that their organization was involved in a data breach in the past year. Moreover, of all the organizations that suffered a data breach, 47 per cent reported a strong to moderate long-term negative impact on their business. In spite of that, 27 per cent of business executives globally view security initiatives as having a negative return on investment.
Astonishingly, three quarters (76 per cent) of those business executives globally who view security initiatives as having a negative ROI have previously been involved in a publicly disclosed data breach. This suggests that, despite recognizing the negative business impact that a breach carries, over one-quarter have yet to address the modern security challenges and data breach implications, and they have not learned from previous mistakes.
This is especially important in India because 91 per cent of consumers are online shoppers with over 80 per cent having shopped more than four times over a period of last 12 months. Not surprisingly, of those online shoppers, 91 per cent use their smartphones for shopping, the second highest in of all the countries surveyed. India also ranked second of all the countries surveyed at 84 per cent amongst the users that use smartphones for online banking.
“India has the second largest population of internet users in the world, home to 481 million internet users. Indian consumers are increasingly transacting online, and organizations now have access to a vast amount of data, from personal information to user behaviour,” said Sunil Manglore, Managing Director, India, CA Technologies. “The responsibility to protect data has never been more vital. It is essential for organizations to integrate security into the development process from the start —a key principle in our Modern Software Factory model. Digital trust goes hand-in-hand with the consumer experience and organizations owe a five-star experience to their consumers.”
Jarad Carleton, industry principal, Cybersecurity at Frost & Sullivan, said, “We are at a crossroads in the information age as more companies are being pulled into the spotlight for failing to protect the data they hold, so with this research, we sought to understand how consumers feel about putting data in organizations’ hands and how those organizations view their duty of care to protect that data. What the survey found is that there is certainly a price to pay – whether you’re a consumer or you run a business that handles consumer data – when it comes to maintaining data privacy. Respect for consumer privacy must become an ethical pillar for any business that collects user data.”
Organizations Must Do More to Protect Customer Data
Amidst a continuous stream of headlines about major data breaches, 95 per cent of organizations believe it is important to implement technology to detect and block insider threats to consumer data. This is a good sign because protecting PII in an organization requires a tripartite system of security that encompasses people, processes and technology. However, organizations need to look beyond this and implement additional next-generation security technology tools. When looking to transition people from low and moderate digital trust to high digital trust, consumers need organizations to be concise and candid about how they protect data – if it is sold or shared, and how or if consumers who pay for services can permanently opt out from data sharing. Embracing this will begin the process of increasing consumers’ trust in organizations which stand to benefit from a future customer base that trusts companies with their personal information.